Questions re: FHA Loan and similar issues....... (Dallas: foreclosure, mortgage)

[ModernHomeNow]

I realize that requirements and standards by lending companies and FHA are much more strict than they were 2 years ago. With that being said, we were just told by our lender that subsequent to their FHA appraisal of the home, there are several things that have to be done to the house, before we are fully approved and are able to close.

Now, the problem is this. The option period (the period where buyer or seller can essentially walk away - no harm done) is over and we're not sure who is going to pay for the listed requirements. It isn't a huge list, and I can personally do most of it, but of course that takes time and money, albeit not a large sum of cash, but you get the point. We are reluctant to ask for everything to be done by the seller as we have negotiated a good price in a very good area in Dallas, where demand is strong. But, in my opinion, doesn't the lender or our Realtor have an obligation to us, as clients to get the FHA appraisal done PRIOR to the option period expiring? As I see it, if we choose to do/pay for the work ourselves, we're doing so to a home that we don't own. Not to mention, the FHA appraisal was performed 2 days before the scheduled closing. This puts us in a bad spot for several reasons, one (1) being our contract with the Seller ends soon, and two (2) our Interest Rate we already locked in will expire as well, meaning we will need to lock another Rate, which could definitely be higher considering the Market we're in.

If this makes sense, help me out!;-)

Thanks.....

[grumpy31700]

Are you buying a REO or Foreclosure? Usually the home not passing inspection will allow you back out of the deal. Have the seller make the repairs and at closing you pay them back if they do not agree then you can back out.

[nsumner]

The option period is a time for you to do the inspections and due dilligence or just change your mind. You don't have to order the appraisal at that time and actually over 98% it is done AFTER the option period because in case things are found during the inspection, you can back out of the contract and not have to incurr the expense of an appraisal.

Your contract has a contingency on lender required repairs even though it is after the option period. The sellers are not required to repair them but you can negotiate that with them.

Flags should have been raised 10 days before closing if the appraisal wasn't done yet and consider a lock extention at that time. Lenders and Realtors do not have the right to speak to the appraiser. It is done electronically. The order is put in and the appraiser doesn't have a time limit to return it but on average a week.

When is your closing scheduled for? After the work is done, the appraiser is very likely going to have to come back to check that it was done. Some do some don't. I've had one accept pictures of the work in order to expedite things.

Naima

[HockeyDadof2]

Appraiser do have a time they have to get their reports finished, it's typically 3 or 4 business days. Often they are order as a "rush" because someone at the mortgage company or the AMC didn't order their appraisal in a timely manner.

An FHA purchase contract should have a contigency for approval of an FHA loan at a maximum of X %. Part of being approved for an FHA loan is that the subject must meet minimum FHA requirements. If it doesn't meet the requirements the home doesn't qualify for an FHA loan and it's up to the seller to fix it.

It sounds like the repairs being required are fairly extensive? A reinspection is likely going to be required.